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PFI Contracts

I am grateful for the chance to introduce this debate. Before I go into detail, it is my duty to declare two specific and important interests in this matter. First and foremost, I am obviously a Conservative, and it was the last Conservative Government who introduced the private finance initiative in 1992. I have absolutely no objections whatsoever to well-planned PFIs. They make good financial sense, the risk capital comes from the private sector and a decent cut of any reward is designed to end up in the public purse. The Treasury measures success by the simple yardstick that PFIs must be fair, and above all, accountable. They have a highly detailed standard contract procedure, which is understood by all parties. Private finance initiatives have their critics, and things can go wrong, but they are the most tried and trusted example of private partnerships. My second declaration of interest is much more important. I have a financial stake in the private partnership that we are considering. I live in Somerset and pay taxes to Somerset county council. I have thus become a small shareholder in a huge new joint venture, brokered by the county and run by the global computer giant, IBM. The company is called Southwest One. The Under-Secretary of State for Communities and Local Government, the hon. Member for Gloucester (Mr. Dhanda), will be familiar with many of my concerns because we have discussed the matter privately and in this place. He listened to my speech in Westminster Hall on 26 March on the subject, and I thank him for his response to it. During that debate, I clearly expressed my anxieties about the way in which the company came into being. I feared corruption, and I made that clear at the time. I can prove that lies have been told and, tonight, I will produce fresh evidence. I should like to make one thing crystal clear. Some have wrongly accused me of sheltering behind the protection of parliamentary privilege. That is incorrect. I have repeated outside everything that I have ever said about Southwest One here. My website and my blog—modesty forbids, but it is called Mogg the Blog—bear ample testimony to that. I have laid myself open to any legal challenge and, as yet, no one has dared challenge me. Southwest One is formed of two councils—Somerset county and Taunton Deane borough—plus one police authority, Avon and Somerset constabulary. I remind the House that its business partner is IBM. Hon. Members will be surprised to learn that IBM owns 75 per cent. of the company. That means that, if Southwest One ever makes a profit, the ““Big Blue”” will pocket three quarters of it. It is a 10-year venture, which was supposed to save money. Somerset council claims that it will save it £200 million—£20 million a year. Yet the county offers no logical explanation or business realisation plan. Why? There is not one. There is a document, which falsely describes itself as the business realisation plan, but it contains not one single fact or figure. Instead, it is an exercise in vivid imagination, probably written by—dare I say it, and show my venerable age—Andy Pandy. Let me give an example. The document states:"““Improved supplier service levels will result in authorities delivering higher performance.””" Excuse me—what is the precise predicted improvement year after year? We do not have any numbers—but there are no numbers. It is all aspirational garbage. When did the document appear? Only the other day, after persistent demands under the Freedom of Information Act 2000 from angry trade unionists. I pay tribute to Unison, which has not stopped its campaign. As a taxpayer and Somerset Member of Parliament, I share its anger and frustration. I gently say that I hope that the Minister does, too. It is no way in which to conduct intelligent business. The Government already rightly publish excellent advice on how to do things. Business Link describes best practice thus:"““Success in a joint venture depends on thorough research and analysis of aims and objectives. This should be followed up with effective communication of the business plan to everyone involved.””" However, the architects of the joint venture company have strangled information to such a tiny trickle that nobody outside the magic inner circle knows what is going on. Not one elected councillor of any persuasion has been given unrestricted access to the 3,000 page contract, which was signed last September. Most of it stays hidden. Councillors, the unions and the public who, like me, pay for all that, have been treated like mushrooms. We have been left in the dark and, every now and then, some smug soul chucks a bucket of manure over us. The last big bucket of dung was delivered yesterday by the very man who boasted that not a single job would be put at risk by the deal. As the Under-Secretary knows, I am talking about the chief executive of Somerset county council—a man who has lied consistently to everyone at all stages. Yesterday, he calmly told an audience of more than 200 councillors, almost in a throwaway line, that restructuring services throughout Somerset would probably mean a 30 per cent. cut in the total work force. That would mean Somerset county shedding 5,000 jobs in front-line services and almost 200 each for the five district councils. However, some of those councils do not employ 200 people directly. Mr. Jones was not authorised or expected to say what he did; it just slipped from his lips like a blob of saliva. He is a man who claims to be guaranteeing the jobs in Southwest One, but he has now told us that thousands of other jobs will be sacrificed by the people of Somerset. That is the ultimate betrayal, and the unions and others now call him Alan ““Judas”” Jones. The current leader of the council, Jill Shortland, is trying tonight to explain away his words, by claiming that any job losses can be achieved by natural wastage. But the only natural wastage that most people want to see is the immediate departure of that incredibly dangerous man, who has cocked up and covered up for far too long. We do not even know for sure who is on the board of Southwest One. There are quite a few bods from IBM, naturally, and a couple of harmless councillors who would not say boo to a goose or recognise a balance sheet if it bit them, like a goose, on the bottom, as well as the chief constable of Avon and Somerset police force, who apparently has the right to sit on a public board. I do not think that I have heard of an arrangement quite as dodgy as that. I am also reliably informed that the chief executive of Somerset county council is another regular attendee at board meetings, but that is hearsay. Mr. Jones has always sworn blind that he plays no active part in Southwest One. I am afraid that that now looks like another whopping lie. I intend to dwell on Mr. Jones for quite a while. He more than any other public official has been involved in the formation of the company, and it is his ruthless tactics that we must expose. Mr. Jones has a habit of falling out with people and then covering it up. The first effective manager of ISiS—the improving services in Somerset programme, which was the precursor to Southwest One—was a bright and attractive young lady called Jenny Hastings, a constituent. She and Mr. Jones worked effectively and closely, but then there was the falling-out. All councils have a procedure for resolving grievances—we all know that; we are Members of this place—but in that case there must have been something extremely difficult to resolve. The timing was uncomfortable. The Audit Commission was about to examine the county's books. Somerset's quest for five shining stars would have fallen flat on its face if the chief executive had been embroiled in a tacky public industrial tribunal. It took the services of ACAS to thrash out an agreement, under which Mrs. Hastings departed amicably—and silently. The process also cost an awful lot of public money. I would like to know how much. I made a request under the Freedom of Information Act 2000 more than a year ago, but the council is still dragging its feet and delaying a response. Mr. Jones's reputation in county hall is a legend—a remarkable achievement. I am told by the unions that anthrax is more popular than Alan Jones, but I would not know personally. I am no friend of the Liberal Democrats—the Minister knows that, and you certainly do, Mr. Speaker—who hold political control, but I am appalled and horrified by the manner in which Alan Jones manipulates them. There is no better example of that than what happened to one councillor, who was the deputy leader of the Liberal Democrats on the county council.